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Implementing Welfare Reform: A State Report Card

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Publication Date: October 2004

Publisher(s): Cato Institute

Author(s): Jenifer Zeigler

Topic: Social conditions (Public welfare and social services)

Type: Report


In 1996 the Personal Responsibility and Work Opportunity Reconciliation Act was signed into law, and the nation waited to see if welfare reform would truly "end welfare as we know it." Block grant funding and administrative devolution gave the states a chance to move beyond pilot programs and prove that they could transition people off welfare more efficiently and effectively than the federal government. As a result, caseloads have dropped by more than half.

Congress is currently debating the reauthorization of PRWORA, and there are a variety of perspectives on the direction welfare reform should now take. It is useful to look at the policy decisions states have made over the past seven years and compare the results. This paper emphasizes the positive policy choices made by states regarding welfare reform implementation--choices that encourage personal responsibility and self-sufficiency.

Strong structural reforms in a state's welfare system--including time limits, sanctions, and narrow definitions of work activity--lay the foundation for successful reorganization. Idaho, Ohio, Wisconsin, and Wyoming combined those reforms with positive quantitative outcomes and received the highest grade of A. California and New York, the states with the largest welfare caseloads, will struggle to maintain their C grades in the coming years since they lack programs that encourage self-sufficency. Vermont received the lowest of the failing grades, including the lowest grade on implementation of structural reforms required for a successful state welfare program.

Strained state budgets, a fluctuating economy, and new "pet programs" packed into welfare reauthorization will all change the face of welfare over the next several years. This study offers analysis of state welfare reform implementation in the present and can serve as a baseline for tracking welfare reauthorization program changes in the future.